Is Cambridge, Minnesota Good for Airbnb Investment?

To start an Airbnb in Cambridge, Minnesota, begin by researching local zoning ordinances through the Cambridge City Hall at 107 1st Avenue NW, as the city requires short-term rental operators to obtain a business license and comply with residential zoning restrictions that typically limit rentals to owner-occupied properties or designated areas. Contact the Isanti County Planning Department to verify any county-level regulations and obtain necessary permits, including a Minnesota sales tax permit from the Department of Revenue since you'll collect lodging taxes. Find a suitable property in residential zones that allow short-term rentals, ensuring it meets Minnesota's building codes and has proper egress windows, smoke detectors, and carbon monoxide detectors as required by state law. Furnish the space with quality furniture, linens, and amenities while ensuring compliance with Americans with Disabilities Act guidelines where applicable, and install keyless entry systems for guest convenience. Create your Airbnb listing with professional photos, competitive pricing based on Cambridge's average rate of $80-120 per night, and highlight local attractions like the Rum River and nearby state parks. For ongoing management, establish cleaning protocols between guests, maintain liability insurance coverage of at least $1 million, collect Minnesota's 6.875% sales tax plus any local lodging taxes, keep detailed records for tax purposes, and consider using property management software to handle bookings, communications, and maintenance scheduling while staying responsive to guest needs and city compliance requirements.

To identify profitable short-term rental properties in Cambridge, Minnesota, focus on locations within walking distance of the Rum River or near recreational areas like Cambridge City Beach and Isanti County parks, as these attract tourists year-round for fishing, boating, and outdoor activities. Target 2-4 bedroom single-family homes or cabins built after 1980 with modern amenities, full kitchens, outdoor spaces, and parking, as families and groups visiting for lake activities prefer these features. Analyze pricing by researching comparable Airbnb and VRBO listings within a 10-mile radius, aiming for properties that can command $80-150 per night depending on size and amenities, while ensuring purchase prices allow for positive cash flow after accounting for 65-75% occupancy rates. Study competition by examining existing STR listings in Cambridge and nearby Isanti, Princeton, and Milaca to identify gaps in amenities or property types, particularly focusing on pet-friendly options and properties that accommodate larger groups. Utilize tools like AirDNA and Mashvisor for market analysis, the City of Cambridge's zoning maps to confirm STR compliance, Zillow and MLS for property searches, and STR-specific platforms like Awning or RedAwning for performance projections, while also consulting local real estate agents familiar with the Cambridge market and seasonal tourism patterns driven by proximity to the Twin Cities metro area.

To obtain an Airbnb/STR permit in Cambridge, Minnesota, contact the Cambridge City Hall at 107 3rd Avenue NW or call 763-689-3067 to begin the application process, as the city requires short-term rental operators to obtain a business license and comply with zoning regulations. Submit a completed business license application along with a site plan showing the property layout, proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, and a floor plan indicating maximum occupancy limits. The application fee is typically $100-150 for the initial business license plus any applicable zoning permits, and you must also register with the Minnesota Department of Revenue for tax collection purposes. The approval timeline is generally 30-45 days depending on zoning review and any required inspections. Cambridge-specific requirements include maintaining the property as a primary residence if operating a home-based business, ensuring adequate parking spaces for guests, providing emergency contact information to neighbors, and complying with noise ordinances and occupancy limits based on bedroom count. Properties must pass safety inspections including smoke and carbon monoxide detectors, and operators must collect and remit local lodging taxes quarterly to the city.

Short-term rentals (STRs) are legal in Cambridge, Minnesota, but operate under specific regulations established by the city. Cambridge requires STR operators to obtain a business license and comply with zoning restrictions that typically limit rentals to certain residential districts while prohibiting them in some neighborhoods to preserve residential character. The city has implemented occupancy limits, parking requirements, and noise ordinances that STR operators must follow, with violations potentially resulting in license revocation. Recent changes around 2022-2023 have included stricter enforcement mechanisms and clearer definitions of what constitutes a short-term rental versus traditional lodging. Property owners must also ensure compliance with state fire safety codes and may face additional requirements for properties that rent for less than 30 consecutive days, with the city maintaining the right to inspect licensed STR properties for code compliance and neighbor complaint resolution.

The best Airbnb investment areas in Cambridge, Minnesota include the downtown historic district near the Rum River, which attracts visitors interested in the city's Swedish heritage and annual Potato Festival, and neighborhoods near Cambridge-Isanti High School and the Cambridge Medical Center that cater to families visiting for school events and medical appointments. The areas around Green Lake and the Isanti County Fairgrounds are particularly attractive during summer months and fair season (typically July), drawing tourists for recreational activities and the annual county fair. Properties near Highway 65 corridor offer convenient access for business travelers working with local manufacturing companies like Cambridge Medical Technologies, while neighborhoods close to the Cambridge Golf Club appeal to golf enthusiasts and weekend visitors from the Twin Cities metro area seeking recreational getaways approximately 45 minutes north of Minneapolis.

In Cambridge, Minnesota, Airbnb hosts are subject to both state and local lodging taxes. The Minnesota state lodging tax is 3% on gross receipts from lodging rentals, which applies to all short-term rentals including Airbnbs. Additionally, Cambridge imposes a local lodging tax of approximately 3-4% on short-term rental accommodations. These taxes are typically collected from guests at the time of booking through Airbnb's platform, which automatically calculates and collects the taxes on behalf of hosts in many Minnesota jurisdictions. Hosts must register with the Minnesota Department of Revenue and obtain a tax identification number, then remit collected taxes monthly or quarterly depending on their volume, with returns due by the 20th of the month following the reporting period. The city of Cambridge may also require separate registration and remittance for local taxes. Exemptions generally include stays of 30 days or longer, which are considered long-term rentals rather than transient lodging, and accommodations provided to permanent residents. Hosts should verify current rates and collection procedures with both the Minnesota Department of Revenue and Cambridge city offices, as tax rates and administrative procedures can change periodically.

To start an Airbnb in Cambridge, Minnesota, expect total costs around $285,000-$320,000. Property purchase represents the largest expense at approximately $250,000-$275,000 based on median home prices in the Cambridge area as of 2023-2024. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom home including furniture, bedding, kitchenware, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic marketing materials run $1,500-$3,000. Permits and fees vary but expect $500-$1,500 for business licenses, short-term rental permits, and any required inspections from Isanti County and Cambridge city authorities. Insurance costs increase significantly for short-term rentals, adding approximately $2,000-$4,000 annually above standard homeowner's insurance. Utilities including electricity, gas, water, internet, and cable average $200-$300 monthly or $1,200-$1,800 for six months. First six months operating costs including cleaning services, supplies, maintenance, property management software, and marketing total approximately $8,000-$12,000. Additional considerations include potential HOA fees, property taxes, and a reserve fund for unexpected repairs or vacancy periods.

Airbnb properties in Cambridge, Minnesota typically generate annual revenues between $15,000-$35,000 for entire homes, with average daily rates ranging from $85-$150 depending on property size and amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), property management (10-20% of revenue), utilities ($150-$300 monthly), insurance ($800-$1,500 annually), and maintenance costs averaging $2,000-$4,000 yearly. Net profit margins typically range from 15-35% for well-managed properties, with successful hosts achieving higher margins through strategic pricing, excellent guest experiences, and efficient operations. Properties within 2-3 miles of Cambridge's downtown area and those offering unique amenities like lake access, fire pits, or proximity to Rum River perform significantly better than standard suburban listings. A typical 3-bedroom home purchased for $250,000 and generating $28,000 in annual Airbnb revenue with $18,000 in expenses would yield approximately $10,000 in net profit (36% margin), though success heavily depends on occupancy rates averaging 60-75% during peak summer months and 30-45% during winter periods, with properties near recreational areas like Cambridge City Beach and Isanti County parks commanding premium rates and higher occupancy.

Airbnb investments in Cambridge, Minnesota typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% based on current market conditions. Properties in Cambridge, located approximately 45 minutes north of Minneapolis, benefit from proximity to Rum River and outdoor recreation areas, attracting weekend visitors and seasonal tourists. Initial investment costs average $180,000-$250,000 for suitable properties, with expected gross rental income of $18,000-$30,000 annually depending on property size and amenities. Operating expenses including cleaning, maintenance, insurance, and platform fees typically consume 40-50% of gross revenue. Most investors achieve break-even within 18-24 months and positive cash flow by month 30, with full ROI realization occurring within 7-10 years. The market shows seasonal fluctuations with peak demand during summer months (June-August) and winter recreation periods, while spring and fall see moderate occupancy rates of 60-70%.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Cambridge, Minnesota. Local real estate agents in the Cambridge area who specialize in investment properties include agents from Edina Realty, RE/MAX Results, and Coldwell Banker Realty who understand the Anoka County market dynamics. National services like Mashvisor, AirDNA, and BiggerPockets provide market analysis and property identification tools for the Cambridge market. Local property management companies such as North Metro Property Management and Twin Cities-based Awning Property Management offer Airbnb management services in the area. Investment-focused real estate companies like HomeVestors and national franchises such as Keller Williams have agents trained in short-term rental investments who serve the Cambridge market. Additional services include Rabbu for market analysis, Rentometer for rental comparisons, and local mortgage brokers familiar with investment property financing in Minnesota's regulatory environment.